Show TAKE A LOOK AT Ar CONVERTIBLE SECURITIES During times of poor business slumping corporate profits and doubtful prospects as to the maintenance of dividends on common stocks characteristic of the past year or frightening so-frightening and confused investors simply are turned off of stock investments Yet while there are times when caution should be exercised and cash reserves built up up for future buying it is also true that there comes a time when a badly battered stock market market offers a host of priced bargain issues Most investors however find themselves during a period of strongly advancing stock prices looking back and regretting not having taken advantage of attractively priced stocks when the market was at or near its low In fact in the anxious days accompanying depressed phases of the market cycle few Investors have the discipline to lay the groundwork for Cor future growth and income appreciation DILEMMA OF INCOME INVESTORS For those dependent on their investment income to varying degrees the situation is especially agonizing Even though they may be inclined to use some some of oC their cash reserves in playing for a rebound in individual stocks and the market as a whole when continuity of dividend payments may maybe maybe be suspect they naturally hesitate or wait until the threat to investment income abates In most instances however the chance to buy stocks at low low-if not necessarily the prices lowest will have vanished by the time earnings snap back and dividend on common issues are healthier But fortunately there there there-is is an alternative for Investors who want income that is better protected than that deriving from common stocks CONVERTIBLE SECURITIES WORTH CONSIDERING Certain corporate debentures notes and preferred and preference stocks are issued with the provision that they can be converted into the common of the issuing company at designated rates and items These precede common stocks when it comes to payment of Interest on debentures and notes and dividends preferred and preference stocks n a Obviously convertible securities offer a better cushion with respect ct to investment income than the related common stocks Also in some same instances convertible securities can be purchased at a higher yield than that available on the common stock However Investors who may be worried about inflation want the periodic ups step in divid dividend nd rates and the capital appreciation potential provided by common stocks over the longer haul It is true that the great majority of convertible securities are of the fixed income variety but once the income advantage shifts to the common stock holders of the related convertible securities can exercise the conversion privilege As for the capital appreciation aspect convertible securities tend to move in market value in concert with their related common stocks Changes in a common stock result In Incommensurate incommensurate commensurate fluctuations in the conversion value of any securities which are convertible into that common Thus investments in inconvertible inconvertible convertible securities ties make sense sense when the stock market is in a depressed range INVEST CARE It should be noted that all corporations do not have convertible securities in their capitalization In addition many companies of secondary or tertiary quality have convertible securities which are not suitable for investors who are not in a position to undertake risks in terms of income or as to the safety of their capital At the present time however the Research Department of Babson's Reports favors purchase of convertibles for portfolios looking toward well sustained income Recommended specifically are the convertibles of the Bank of New York Cv debenture of oC and 2006 the Cooper Industries 29 Cum Cv Preferred |